Along with the environmental benefits of using a natural refrigerant in the heat pump, users will want to know that they are also saving money by using the technology. The economics of a heat pump are closely linked to the COP value since it represents the ratio of the heat produced over the electrical consumption. With a COP of 2, 1kW of electricity will be transformed in 2kW of heat. In comparison, a conventional electric heater won't produce more than 1kW of heat with 1 kW of electricity. The lower the COP the lower the amount of energy produced in relation to the electrical energy used.
Most heat pump manufacturers will quote a COP for their product above 3 as this is seen as being around the minimum benchmark for heat pumps. This is usually calculated in the factory under controlled conditions in line with the standard EN-14511 and the manufacturers always tend to quote the COP in favourable conditions. This does not take into consideration the individual climate or load placed on the heat pump by the householders. The actual seasonal performance factor (mean COP over the year) of an individual heat pump is often found to be lower than that stated by the makers.
In general the economical aspect of using a heat pump will be compared with an electrical installations. The initial cost of a heat pump are quite high in comparison with a simple electric Heater. However, with a COP above 1, a heat pump will consume less electricity to produce the same amount of heat. Considering a constant price for the electricity, the pay back period of a heat pump will depend on the COP, the initial capital cost, the price of the electricity and the annual amount of heat required to heat the House.
If we consider a case study of a detached house following the regulation of 2002, the annual space heating demand is around 120kWh per square meter and year and the hot water demand is around 50kWh per square meter and year (source: software EDEM developed at the University of Strathclyde). Considering a house of 100 square meters, the comparison of different installations prices is presented on the table below.
It can be seen that even with a lower VAT for the heat pumps, the pay back period is quite long, around 8 years with a COP of 2 and less than 7 years with a COP of 2.5. However in term of CO2 emissions, as less electricity is used to produce the same amount of heat, the carbon footprint during the system operation is divided by the COP of the heat pump which bring a significant reduction.
However the electricity prices are in general fluctuating and it is possible to subscribe contract with different prices in function of the period of the day. During off-peak period (during the night in particular) the electricity can be much cheaper than during the day. Thus it is also quite common and profitable to use conventional electric heater with a proper programming to make them run during off-peak period with an adapted thermal storage. However for the Sanyo Eco Cute system and for most of heat pump installations, the systems are not design for this kind of use. It could be an interesting solution to decrease still a bit more the running cost of heat pumps. In this case, colder temperature might induce a lower COP during the night, but the off peak electricity price should be much more advantageous.
At the moment there is no government pay-back scheme for heat pump owners like there is with the feed in tariffs for electricity production. In March 2011 the Renewable Heat Incentive (RHI) scheme was launched initially for the non-domestic market and air-source heat pumps were not included in the viable technologies covered by the scheme. It is intended though that they will be part of the scheme for domestic dwelling when the second stage is rolled out in October 2012. This will increase the cost effectiveness of air-source heat pumps, allowing the users to generate a small income from their renewable energy source. For domestic dwellings the scheme is currently offering cash to assist with purchasing and installation of air-source heat pumps, the DECC have announced that it could be around £850.00unit.
For more information on the RHI scheme please follow this link, RHI.
The economic benefits of using a CO2 heat pump will be achievable by understanding the thermodynamic properties of CO2 and using the heat pump accordingly. Correct sizing and installation of the heat pump and the entire hot water system of the dwelling will allow the CO2 heat pump to work most effectively and make it more competitive with heat pumps using other types of refrigerant.